Post-handover payment plan

Under a post-handover plan the developer defers a share of the price, often 20% to 50%, beyond completion. You pay the rest during construction and at handover, move in or let the property, and settle the deferred part in monthly or quarterly instalments over a period that usually runs from one to five years. A plan described as 50/50 over three years means half by handover and half across the three years after it. Instalments are normally interest-free.

The appeal is clear: you can occupy or earn rent while still paying, without a bank's affordability test, which suits buyers who would struggle to obtain a non-resident mortgage.

The trade-offs deserve equal attention:

• Price. The developer is lending you money. The cost is built into the price, so compare with similar units sold on standard terms.
• Title. In Dubai a unit moves from the interim register to the main register once it is fully paid. Until the last instalment clears you will generally not hold a clean title deed, or the developer will keep a charge over the unit.
• Selling and refinancing. A sale before the plan ends needs the developer's NOC, usually on settlement of the balance, and banks are reluctant to lend against a unit that still owes its developer.
• Default. Missing payments after you have moved in can still lead to termination and loss of sums paid.
• Visas. Eligibility for property-linked residency can depend on how much you have paid.

See payment plan for how the stages before handover work.